SpringerLink
Log in

Institutions, Human Capital, and Economic Growth in the Maghreb countries

  • Published:
Journal of the Knowledge Economy Aims and scope Submit manuscript

Abstract

This paper considers the relationship between institutional quality, human capital, and economic growth. More specifically, we seek to establish the linkages by which economic freedom affects real GDP growth via its mediating impact on human capital. These associations were investigated using the dynamic system generalized method of moments (GMM) on a panel of 3 Maghreb countries, namely, Tunisia, Algeria, and Morocco over the 1991–2020 period. The results show that (1) in the long run, both institutional quality and human capital can promote economic growth. (2) Institutional quality and human capital have a significant positive interactive effect on the economic growth. Policy implications of these results are that careful attention should be paid to co-development policies to enhance the institutional quality and the human capital in these countries. Policies should also consider economic growth strategies to enable sustainable economic growth rates.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Subscribe and save

Springer+ Basic
EUR 32.99 /Month
  • Get 10 units per month
  • Download Article/Chapter or Ebook
  • 1 Unit = 1 Article or 1 Chapter
  • Cancel anytime
Subscribe now

Buy Now

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Graph 1
Graph 2
Graph 3
Graph 4
Graph 5
Graph 6
Graph 7
Graph 8
Graph 9
Graph 10

Data Availability

The data that supports the findings of this study is available on request.

References

  • Abdulwahab, L. O. (2023). The role of institutional quality, human capital development on economic growth in Sub-Saharan Africa. International Journal of Business Economics, 5(1), 92–115.

    Google Scholar 

  • Acemoglu, D., & Robinson, J. A. (2015). The rise and decline of general laws of capitalism. Journal of Economic Perspectives, 29(1), 3–28.

    Article  Google Scholar 

  • Acemoglu, D., Naidu, S., Restrepo, P., & Robinson, J. A. (2015). Democracy, redistribution, and inequality. In Handbook of Income Distribution, 2, 1885–1966.

    Article  Google Scholar 

  • Acemoglu, D., Johnson, S, Robinson, J.A. (2004). Institutions as a fundamental cause of long-run growth. National Bureau of Economic Research Working Paper No. 10481.

  • Adeleye, B. N., Bengana, I., Boukhelkhal, A., Shafq, M. M., & Abdulkareem, H. K. (2022). Does human capital tilt the population-economic growth dynamics? Evidence from middle east and north African countries. Social Indicators Research, 162(2), 863–883.

    Article  Google Scholar 

  • Afonso, A., Jalles, J. (2016). Economic performance, government size, and institutional quality. Empirica, 43(1), 83–109.

    Article  Google Scholar 

  • African Development Bank Group. (2019). Report on regional integration in the Maghreb: Challenges and opportunities for the private sector. https://www.afdb.org/en/documents/report-regional-integration-maghreb-2019-challenges-and-opportunities-private-sector-synthesis

  • Ahmed, F., Kousar, S., Pervaiz, A., & Shabbir, A. (2022). Do institutional quality and financial development affect sustainable economic growth? Evidence from south Asian countries. Borsa Istanbul Review, 22(1), 189–196.

    Article  Google Scholar 

  • Aitken, B., Hanson, G., & Harrison, A. (1997). Spillovers, foreign investment, and export behavior. Journal of International Economics, 43(1–2), 103–132.

    Article  Google Scholar 

  • Ali, S., Yusop, Z., Kaliappan, S. R., Chin, L., & Nazar, R. (2022). Impact of trade openness, human capital, and institutional performance on economic growth: Evidence from Organization of Islamic Cooperation countries. Journal of Public Affairs, 22(e2654), 1–12.

    Google Scholar 

  • Arellano, M., & Bond, S. (1991). Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies, 58(2), 277–297.

    Article  Google Scholar 

  • Aydın, C., Esenb, O., & Bayrakc, M. (2016). Inflation and economic growth: A dynamic panel threshold analysis for Turkish republics in transition process. Procedia - Social and Behavioral Sciences, 229, 196–205.

    Article  Google Scholar 

  • Barro, R. J. (1991). Economic growth in a cross section of countries. The Quarterly Journal of Economics, 106(2), 407–443.

    Article  Google Scholar 

  • Barro, R. J., & Sala-i-Martin, X. (1997). Technological diffusion, convergence, and growth. Journal of Economic Growth, 2(1), 1–27.

    Article  Google Scholar 

  • Becherair, A. (2014). Institutions and economic growth in the MENA countries: An empirical investigation by using panel data model. MPRA Paper 57683. https://mpra.ub.uni-muenchen.de/57683/

  • Becker, G. S. (1964). Human capital: A theoretical and empirical analysis with special reference to education. Columbia University Press.

    Google Scholar 

  • Ben Khalifa, A. (2021). Investissement dans l’économie de la connaissance, innovation et productivité : cas des entreprises manufacturières tunisiennes. Etude de l’Institut Tunisien de la Compétitivité et des Études Quantitatives. Tunisie

  • Ben Slimane, S., Ramadan, M. (2017). Le système national d’innovation dans les pays du Maghreb: Entre failles structurelles et besoin de coordination et de gouvernance appropriées. Innovations, 2(53), 105–127.

    Article  Google Scholar 

  • Bentour, E. M. (2020). The effects of human capital on economic growth in the Arab countries compared to some Asian and OECD countries. Arab Monetary Fund, pp. 1–33

  • Bircan, C. (2019). Ownership structure and productivity of multinationals. Journal of International Economics, 116, 125–143.

    Article  Google Scholar 

  • Blundell, R., & Bond, S. (1998). Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics, 87, 115–143.

    Article  Google Scholar 

  • Bose, N., Haque, M. E., & Osborn, D. (2007). Public expenditure and economic growth: A disaggregated analysis for develo** countries. The Manchester School, 75(5), 533–556.

    Article  Google Scholar 

  • Boukhatem, J., Ben Moussa, F. (2023). Financial inclusion, institutional quality, and economic growth in MENA countries: Some evidence from panel cointegration. Macroeconomics and Finance in Emerging Market Economies, 1–24. https://doi.org/10.1080/17520843.2023.2284455

  • Bounoua, C., & Matallah, S. (2014). The impact of institutional quality on promoting economic growth in selected Maghreb countries. Revue D’economie Et De Management, 13(1), 92–1052.

    Google Scholar 

  • Bouzayani, R., Abida, Z., Abidi, J. (2023). Foreign direct investment, human capital and economic growth in the Arab Maghreb countries. African Review of Economics and Finance, 15(1), 167–178.

    Google Scholar 

  • Brown, D., & Hunter, W. (2004). Democracy and human capital formation. Comparative Political Studies, 33, 113–143.

    Google Scholar 

  • Cadil, J., Petkovová, L., & Blatná, D. (2014). Human capital, economic structure and growth. Procedia Economics and Finance, 12, 85–92.

    Article  Google Scholar 

  • Chang, C., & Mendy, M. (2012). Economic growth and openness in Africa: What is the empirical relationship? Applied Economics Letters, 19(18), 1903–1907.

    Article  Google Scholar 

  • Dincer, O. (2007). The effects of property rights on economic performance. Applied Economics, 39(7), 825–837.

    Article  Google Scholar 

  • Doré, N. I., Teixeira, A. A. C. (2023). The role of human capital, structural change, and institutional quality on Brazil’s economic growth over the last two hundred years (1822–2019). Structural Change and Economic Dynamics, 66, 1–12.

    Article  Google Scholar 

  • Doucouliagos, C., & Ulubasoglu, M. A. (2006). Economic freedom and economic growth: Does specification make a difference? European Journal of Political Economy, 22(1), 60–81.

    Article  Google Scholar 

  • Edison, H., Levine, R., Ricci, L., & Sløk, T. (2002). International financial integration and economic growth. Journal of International Money and Finance, 21(6), 749–776.

    Article  Google Scholar 

  • Erum, N., & Hussain, S. (2019). Corruption, natural resources and economic growth: Evidence from OIC countries. Resources Policy, 63, 1–10.

    Article  Google Scholar 

  • Fang, Z., Chang, Y. (2016) Energy, human capital and economic growth in Asia Pacific countries-Evidence from a panel cointegration and causality analysis. Energy Economics, 56(C), 177–184

  • Francis, A. (2007). The human capital peace, economic development, democracy and international conflict. Working paper University of Chicago

  • Gemmel, N. (1996). Evaluating the impacts of human capital stocks and accumulation on economic growth: Some new evidence. Oxford Bulletin of Economics and Statistics, 58(1), 9–28.

    Article  Google Scholar 

  • Gründler, K., & Potrafke, N. (2019). Corruption and economic growth: New empirical evidence. European Journal of Political Economy, 60, 1–14.

    Article  Google Scholar 

  • Gui-Diby, S. L. (2014). Impact of foreign direct investments on economic growth in Africa: Evidence from three decades of panel data analyses. Research in Economics, 68(3), 248–256.

    Article  Google Scholar 

  • Gwartney, J., Lawson, R., Hall, J., Murphy, R., (2022). Economic freedom of the world: 2022, Annual Report. Fraser Institute

  • Gyimah-Brempong, K., & Wilson, M. (2004). Health human capital and economic growth in Sub-Saharan African and OECD countries. The Quarterly Review of Economics and Finance, 44(2), 296–320.

    Article  Google Scholar 

  • Haggard, S. (2004). Institutions and growth in east Asia. Studies in Comparative International Development, 38(4), 53–81.

    Article  Google Scholar 

  • Haini, H. (2020). Examining the relationship between finance, institutions and economic growth: Evidence from the ASEAN economies. Economic Change and Restructuring, 53, 519–542.

    Article  Google Scholar 

  • Haraguchi, N, Martorano, B, and Sanfilippo, M 2019 What factors drive successful industrialization? Evidence and implications for develo** countries. Structural Change and Economic Dynamics, 49(C), 266–276

  • Hussen, M. S. (2023). Institutional quality and economic growth in Sub-Saharan Africa: A panel data approach. Journal of Economics and Development, 25(4), 332–348.

    Article  Google Scholar 

  • Kamalu, K., & Ibrahim, W. H. W. (2022). The influence of institutional quality on human development: Evidence from develo** countries. Jurnal Ekonomi Malaysia, 56(1), 93–105.

    Google Scholar 

  • Klomp, J., & De Haan, J. (2013). Political regime and human capital: A cross-country analysis. Social Indicators Research, 111(1), 45–73.

    Article  Google Scholar 

  • La Porta, R., Lopez-de-Silanes, F., Shleifer, A., & Vishny, R. W. (1998). Law and finance. Journal of Political Economy, 106, 1113–1155.

    Article  Google Scholar 

  • Law, S. H., Lim, T. C., Ismail, N. W. (2013). Institutions and economic development: A Granger causality analysis of panel data evidence. Economic Systems, 37(4), 610–624.

    Article  Google Scholar 

  • Levine, R. (1999). Law, finance, and economic growth. Journal of Financial Intermediation, 8(1–2), 8–35.

    Article  Google Scholar 

  • Levine, R., (2005). In: Aghion, P. and Durlauf, S.N. (Eds.), Finance and growth: Theory, mechanism and evidence, Handbook of Economic Growth, 1, 865–934.

  • Lucas, R. J. (1988). On the mechanics of economic development. Journal of Monetary Economics, 22(1), 3–42.

    Article  Google Scholar 

  • Makuyana, G., Odhiambo, N. M. (2016). Public and private investment and economic growth in Zambia: A dynamic approach. Working Papers 21377. University of South Africa, Department of Economics

  • Mankiw, N. G., Romer, D., Weil, D. N. (1992). A contribution to the empirics of economic growth. The Quarterly Journal of Economics, 107(2), 407–437.

    Article  Google Scholar 

  • Musibau, H. O., Yusuf, A. H., Gold, K. L. (2019). Endogenous specification of foreign capital inflows, human capital development and economic growth. International Journal of Social Economics, 46(3), 454–472.

    Article  Google Scholar 

  • Nifo, A., Scalera, D., Vecchione, G. (2017). The rule of law and educational choices: Evidence from Italian regions. Regional Studies, 51(7), 1048–1062.

    Article  Google Scholar 

  • North, D. C. (1990). Institutions, institutional change, and economic performance. Cambridge University Press.

    Book  Google Scholar 

  • North, D., Wallis, J., Weingast, B. (2009). Violence and social orders: A conceptual framework for interpreting recorded human history. Cambridge University Press.

    Book  Google Scholar 

  • North, D. C. (1996). Epilogue: Economic performance through time. In L. J. Alston, T. Eggertsson, & D. C. North (Eds.), Empirical studies in institutional change (pp. 342–355). Cambridge: Cambridge University Press.

  • Ogundari, K., Awokuse, T. (2018). Human capital contribution to economic growth in Sub-Saharan Africa: Does health status matter more than education? Economic Analysis and Policy, 58, 131–140.

    Article  Google Scholar 

  • Olaniyi, C. O., Odhiambo, N. M. (2023). Does institutional quality matter in the financial development-economic complexity nexus? Empirical insights from Africa. Research in Globalization, 7, 100137.

    Google Scholar 

  • Ouedraogo, I., Tabi, H. N., Ondoa, H. A., Jiya, A. N. (2022). Institutional quality and human capital development in Africa. Economic Systems, 46(1), 100937.

    Article  Google Scholar 

  • Poku, K., Opoku, E., Ennin, P. A. (2022). The influence of government expenditure on economic growth in Ghana: An ARDL approach. Cogent Economics and Finance, 10(1), 1–16.

    Article  Google Scholar 

  • Ramazan, E., Osman, T., Fatih, C. (2020). The relationship between inflation and economic growth: Experiences of some inflation targeting countries. Financial Studies, 24(1), 6–20.

    Google Scholar 

  • Rodrik, D., Subramanian, A., & Trebbi, F. (2004). Institutions rule: The primacy of institutions over geography and integration in economic development. Journal of Economic Growth, 9(2), 131–165.

    Article  Google Scholar 

  • Romer, P. M. (1986). Increasing returns and long run growth. Journal of Political Economy, 94(5), 1002–1037.

    Article  Google Scholar 

  • Romer, P. (1990). Endogenous technological change. Journal of Political Economy, 98, S71–S102.

    Article  Google Scholar 

  • Saba, I., Abbas, K. (2016). Human capital, trade and economic growth: A comparative study of OIC countries. International Journal of Economics and Empirical Research, 4(7), 348–354.

    Google Scholar 

  • Schultz, T. W. (1961). Investment in human capital. American Economic Review, 51, 1–17.

    Google Scholar 

  • Shikur, Z. H. (2024). Economic freedom, institutional quality, and manufacturing development in African countries. Journal of Applied Economics, 27(1), 2321084.

    Article  Google Scholar 

  • Sobhee, S. K. (2017). The effects of poor institutional quality on economic growth -investigating the case of Sub-Saharan and Latin American economies prior to the world economic downturn. Economic Thought Journal, 1, 69–82.

    Google Scholar 

  • Uddin, M. A., Ali, M. H., Masih, M. (2021). Institutions, human capital and economic growth in develo** countries. Studies in Economics and Finance, 38(2), 361–383.

    Article  Google Scholar 

  • Vieira, P., Teixeira, A. (2006). Human capital and corruption: A microeconomic model of the bribes market with democratic contestability. Notas Económicas, 23, 72–82.

    Google Scholar 

  • Wira**g, M. A. K., Nchofoung, T. N., Etape, F. M. (2023). Revisiting the human capital-economic growth nexus in Africa. SN Business and Economics, 3(115), 1–29.

    Google Scholar 

  • World Bank. (2023). Algeria economic update - Continuing the diversification effort.

  • World Bank. (2024). World development indicators. Washington DC: World Bank.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Faculty of Economics and Management of Sfax, University of Sfax, Sfax, Tunisia

    Zouheir Abida & Houria Abdellaoui

Authors
  1. Zouheir Abida
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Houria Abdellaoui
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Zouheir Abida.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Abida, Z., Abdellaoui, H. Institutions, Human Capital, and Economic Growth in the Maghreb countries. J Knowl Econ (2024). https://doi.org/10.1007/s13132-024-02043-3

Download citation

  • Received:

  • Accepted:

  • Published:

  • DOI: https://doi.org/10.1007/s13132-024-02043-3

Keywords

JEL Classification

Search

Navigation